IOC rejects US crude for Nigerian, Middle Eastern oil amid sanctions against Russia: Report

Indian Oil Corporation (IOC), a major player in India's energy sector, has revised its crude oil procurement strategy, choosing to source oil from West African and Middle Eastern regions instead of the United States. This strategic pivot involves acquiring two million barrels of West African crude oil and one million barrels of Middle Eastern Das crude, reflecting India's commitment to diversifying its energy imports and reducing reliance on traditional suppliers, Business Insider Africa reported.

IOC's latest procurement includes one million barrels each of Nigeria's Agbami and Usan oil grades, secured from TotalEnergies. Additionally, one million barrels of Abu Dhabi's Das crude were purchased from Shell. 

The decision to reduce procurement from the US marks a significant shift in India's import strategy. Previously, IOC purchased five million barrels of US West Texas Intermediate (WTI) crude, highlighting a departure from past practices. India's shift towards West African oil becomes more pronounced as US imports are now sidelined.

This change comes when India had been a substantial buyer of discounted Russian oil following the invasion of Ukraine, enabling India to shield itself from global energy price fluctuations while bypassing Western sanctions.

The recent purchases aim to support economies like Nigeria, set to benefit significantly from India's increased demand. Nigeria, alongside Angola, anticipates stabilizing its export income amid fierce global market competition. This development is viewed positively by African oil-producing nations, seeking to enhance their market positions.

The Nigerian cargoes are obtained free-on-board (FOB), while the Das crude is purchased delivered. Shipments are expected to arrive at Indian ports between late October and early November, marking a continued trend towards diversification in sourcing crude oil.

This strategic realignment showcases India's response to evolving global geopolitical dynamics, as the nation seeks to balance its import sources amidst pressures from sanctions and market demands.

The move addresses India's energy security concerns and strengthens its economic ties with oil-producing nations in West Africa and the Middle East, potentially enhancing India's influence in these regions. This adaptive strategy highlights India's proactive approach to managing its energy needs in a complex global landscape.